Jp Morgan Chase & Co. · NYSE:JPM

Jp Morgan Chase & — Q1 2006 Earnings Presentation

18 slides from Jp Morgan Chase &'s earnings presentation, Apr 19, 2006

  1. Slide 1: Financial Results First Quarter 2006

    A P R I L 1 9, 2 0 0 6 FINANCIAL RESULTS First Quarter 2006

  2. Slide 2: 1Q06 Managed Results

    1Q06 Managed Results1 ($ in millions) $ O/(U) % O/(U) 1Q06 4Q05 1Q05 4Q05 1Q05 Revenue (FTE)1 $15,902 $947 $1,162 6% 8% Credit Costs1 1,280 (1,006) (64) (44%) (5%) Expense (ex. Merger Cost) 9,681 1,223 (111) 14% (1%) Net Income Before Merger Cost 3,125 379 771 14% 33% Merger Cost (after-tax) 44 (4)

  3. Slide 3: 1Q06 Significant Items

    1Q06 Significant Items ($ in millions) Per Share Pre-tax After-tax After-Tax Line of Business Bankruptcy-related benefit (estimate)1 $550 $341 $0.10 Card Services Incremental expense related to (459) (285) (0.08) All LOBs/Corporate SFAS 123R2 Treasury portfolio repositioning (158) (98) (0.03) Corpor

  4. Slide 4: Investment Bank

    Investment Bank ($ in millions) „ Record quarterly revenue of $4.7 billion $ O/(U) 1Q06 4Q05 1Q05 „ Ex. SFAS 123R, net income of $1.0 billion and ROE of 20% Revenue $4,699 $1,504 $512 Investment Bkg. Fees 1,170 9 185 „ Strong IB fees of $1.2 billion up 19% YoY driven by strong advisory and record lo

  5. Slide 5: Retail Financial Services

    Retail Financial Services ($ in millions) „ Net income of $881 million down 11% YoY $ O/(U) driven by weak Mortgage Banking results 1Q06 4Q05 1Q05 Revenue $3,763 $169 ($84) „ Credit quality remains strong Credit Costs 85 (73) (9) „ Announced acquisition of BK’s consumer, Expense 2,2381 97 76 small b

  6. Slide 6: Regional Banking

    Regional Banking ($ in millions) „ Net income of $757mm down 4% YoY $ O/(U) „ Branch production statistics YoY 1Q06 4Q05 1Q05 „ Deposits up 6% Revenue $3,040 $238 $3 „ Checking accounts up 8% Credit Costs 66 (21) 1 „ Branch sales of credit cards up 61% Expense 1,738 102 33 and mortgage loans up 52%

  7. Slide 7: Mortgage Banking & Auto Finance

    Mortgage Banking & Auto Finance Mortgage Banking ($mm) Auto Finance ($mm) $ O/(U) $ O/(U) 1Q06 4Q05 1Q05 1Q06 4Q05 1Q05 Revenue $388 ($36) ($132) Revenue $335 ($33) $45 Production 219 85 (18) Credit Costs 19 (52) (10) Servicing 169 (121) (114) Expense 176 (4) 18 Expense 324 (1) 25 Net Income $85 $14

  8. Slide 8: Card Services (Managed)

    Card Services (Managed) ($ in millions) „ Net income of $901mm up 73% YoY „ ROO of 4.2%; management estimate of ROO ex. $ O/(U) bankruptcy benefit of approximately 2.6% 1Q06 4Q05 1Q05 Revenue $3,685 ($36) ($94) „ Bankruptcy legislation change positively impacted pre- tax earnings by an estimated $55

  9. Slide 9: Commercial Banking

    Commercial Banking ($ in millions) $ O/(U) „ Net income of $240mm up 4% YoY 1Q06 4Q05 1Q05 Revenue $900 ($16) $73 „ Loans up 9% YoY due to growth across all segments Middle Market 623 15 53 Mid-Corporate Banking 137 (11) 14 „ Liability balances up 8% YoY Real Estate 105 (17) 7 Other 35 (3) (1) „ Rev

  10. Slide 10: Treasury & Securities Services

    Treasury & Securities Services ($ in millions) „ Record net income of $312mm up 23% YoY $ O/(U) and 2% QoQ 1Q06 4Q05 1Q05 „ Pre-tax margin of 29% Revenue $1,677 $49 $179 „ Liability balances up 22% YoY; Assets under Treasury Services 693 6 59 custody up 14% YoY5 Worldwide Securities Svcs 984 43 120

  11. Slide 11: Asset & Wealth Management

    Asset & Wealth Management ($ in millions) „ Net income of $313mm up 13% YoY „ Pre-tax margin of 31%; pre-tax margin ex. $ O/(U) SFAS 123R of 36% 1Q06 4Q05 1Q05 Revenue $1,584 $73 $223 „ Assets under management up 11% YoY; net Credit Costs (7) 3 -- asset inflows primarily driven by retail equity- rel

  12. Slide 12: Corporate

    Corporate Total Corporate ($mm) Treasury ($mm) $ O/(U) $ O/(U) 1Q06 4Q05 1Q05 1Q06 4Q05 1Q05 Net Income1 ($416) ($414) $919 Net Income ($270) $304 $558 Private Equity 103 (18) (334) Net Interest Income (278) 111 131 Treasury (270) 304 558 Securities gains/(losses) (158) 389 744 Other (205) (704) 649

  13. Slide 13: Capital Strength

    Capital Strength 1Q06 4Q05 1Q05 Capital/Balance Sheet ($B) 1 Tier 1 capital $73.1 $72.5 $69.4 Risk weighted assets $855.6 $850.6 $811.8 Tier 1 capital ratio 8.5% 8.5% 8.6% Total capital ratio 12.1% 12.0% 11.9% Leverage ratio 6.1% 6.3% 6.3% Common shareholders’ equity less goodwill $64.4 $63.5 $61.6

  14. Slide 14: 1Q06 Summary Assessment

    1Q06 Summary Assessment „ IB net income of $1 billion1 on record revenue „ Regional Banking – Good deposit and account growth „ Card managed net interest margin up QoQ and spend volumes up YoY „ Treasury & Securities Services, Asset & Wealth Management and Commercial Banking produced good returns on

  15. Slide 15: Comments on Outlook

    Comments on Outlook „ IB fee pipeline continues to be strong „ Card Services: „ Underlying credit appears to be better „ Credit costs expected to be higher in 2Q but still below pre-bankruptcy law change levels „ Minimum payment impact in 2H06 expected to be approximately $500mm (split evenly betwee

  16. Slide 16: Appendix

    APPENDIX JPMorganChase ©)

  17. Slide 17: 1Q06 Impact of SFAS 123R – Retirement Eligible

    1Q06 Impact of SFAS 123R – Retirement Eligible Estimated Quarterly Incremental Incremental Expense Expense ($ in millions) 1Q06 2Q06-4Q06 Total $459 $110 Investment Bank 256 70 Retail Financial Services 17 5 Card Services 4 0 Commercial Banking 29 5 Treasury & Securities Services 25 5 Asset & Wealth

  18. Slide 18: Disclaimer

    Disclaimer This presentation contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements are based upon the current beliefs and expectations of JPMorgan Chase’s management and are subject to significant risks and uncertainties. Actu

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